January 13th, 2021 | 11:40 CET
Delivery Hero, GS Holdings, Adler Modemärkte - Corona factor: take profits or buy courageously?
The list of companies benefiting from the Corona pandemic is long. The longer list is that of the companies that have suffered massively, right up to companies deprived of their livelihood. The decisive factor is whether companies can adapt flexibly to general conditions and whether they are financially strong enough to ride out the wave. Regardless of whether they are high flyers or bankrupt vultures, stock market prices do not always reflect a company's appropriate value. If the discrepancy between value and price is too large, it is worthwhile to enter into corresponding trading positions or investments. We present you with three attractive opportunities.
time to read: 2 minutes
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Author:
Carsten Mainitz
ISIN:
SG1CF0000001 , DE000A2E4K43 , DE000A1H8MU2
Table of contents:
Author
Carsten Mainitz
The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.
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DELIVERY HERO SE- Perpetuum mobile?
Who would have thought a few years ago that a food delivery company would one day be one of the 30 largest German stock market stocks? Delivery Hero has also broken the rule of thumb that the newcomer underperforms after an index inclusion in the DAX. The Company is now valued at EUR 28 billion. Earlier this month, the Berlin-based Company took advantage of the high share price to raise EUR 1.2 billion in capital. This capital is intended to accelerate expansion, strengthen existing brands and enter new markets.
Yesterday, Delivery Hero announced it was establishing its own investment arm. DX Ventures will invest in owner-managed startups. The initial amount available is EUR 50 million, which will go into companies in the on-demand service, food technology, sustainable innovation, artificial intelligence, Fintech and logistics sectors.
Yesterday, analysts at DZ Bank recommended the stock as a buy with a price target of EUR 150 but pointed out the high valuation in the sector. In contrast, the valuation of Delivery Hero is "still acceptable". Investors should not forget, despite all the growth fantasy, that the DAX stock will not write profits until 2022 at the earliest.
GS HOLDINGS LIMITED - interesting niche player
Singapore-based GS Holdings operates in two sectors within the food & beverage industry in the Asian island nation. The Company operates various food courts, a halal restaurant in Singapore, as well as a famous restaurant under the brand name "Sing Swee Kee". The restaurants are currently open in the city-state, with a limited number of visitors, so the losses caused by Corona have so far been limited for the Company.
In addition, GS Holdings offers so-called BOP services in the food and beverage industry. BOP stands for branding, operation and procurement. These services are growing rapidly as customers buy in their expertise and then outsource parts of their business in this way. The Company thus helps customers drive growth and innovation based on a broad range of services.
The GS Holdings share has been listed in Germany since the end of 2020. At a share price of EUR 0.27, the innovative Company is valued at around EUR 50 million. The Company is well-positioned in the two business areas and could increasingly benefit from Chinese customers in the BOP business. The cash register is likely to keep ringing and boost the share price.
ADLER MODEMAERKTE AG - What happens now that the Company has filed for insolvency?
On Monday, the textile retailer filed for the opening of insolvency proceedings in self-administration due to over-indebtedness. This self-administration was approved yesterday and business operations will continue in full. After the losses caused by Corona in 2020, the lockdown before Christmas was the straw that broke the camel's back. Adler failed to close the liquidity gap via a government support fund or through investors.
The Company, which has been active in the market for more than 70 years, focuses on large-scale concepts with more than 1,400 sqm of sales space where own and third-party brands are sold. According to its information, the Company is the market leader in the high purchasing power segment of the 55+ age group. Adler generated nearly EUR 500 million in sales from 172 fashion stores in 2019.
In recent days, the share price sank to around EUR 0.40. Yesterday, the share exited trading at over EUR 0.90. The Company is currently valued at just under EUR 17 million.
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